Oakland-based Sungevity raises $125 million

OAKLAND -- Sungevity, an Oakland-based solar energy company, is set to announce Wednesday that it has raised $125 million, its largest funding round to date.

The round includes $40 million in venture capital from Brightpath Capital Partners, Craton Equity Partners, Vision Ridge Partners and Eastern Sun Capital Partners, and $85 million in project financing led by Energy Capital Partners, an energy-focused private equity firm.

Investors largely shied away from solar last year. But that has begun to shift.

"Solar was a bloody word for most of 2012," said Sungevity CEO Andrew Birch in an interview. "But toward the end of the year, that began to change."

Birch added that the investment community is aware that there are two distinct segments in the solar industry -- companies that sell solar energy and those that manufacture solar hardware. While manufacturers have struggled, some companies that finance and install solar units have prospered.

Last year, solar panel startup MiaSolé sold at a fire sale price to a Chinese company and BrightSource Energy shelved its IPO plans. But late in the year, SolarCity, a San Mateo company that is a leading residential installer of solar panels, had a successful IPO, which helped restore confidence in the installation side of solar.

Sungevity designs custom solar systems using satellite imagery and mapping software instead of more costly home visits. Once a customer purchases or leases the system, Sungevity contracts with local installers to put panels on the roof.

Most of Sungevity's 5,000 customers have been in California, but it also has operations in eight other states: Arizona, Colorado, Connecticut, Delaware, Maryland, Massachusetts, New Jersey and New York. It also has a presence in the Netherlands and Australia.

"The majority of our customers are now acquired through referrals from existing customers," Birch said. "We're leveraging the Internet to grow our customer base in an organic way."